The Bank of Latvia » For All » Payment and Settlement Systems » Business Continuity for Latvian Payment and Settlement Systems
Business Continuity Provision for the Payment and Securities Settlement Systems in Latvia
Business continuity provision is a process to ensure that the potential threats which may affect the attainment of the institution's objectives and discharge of the most vital functions are identified and assessed and a set of measures minimising the possibility of disruptions or forced discontinuity of the execution of the most essential functions is implemented, and that, in the event of forced discontinuity, these functions are resumed within a specified period of time and on an acceptable level.
The website presents information about the tasks performed by the Bank of Latvia and the Latvian Central Depository in order to ensure the continuity of the payment and securities settlement systems in Latvia.
A safe and efficient financial market infrastructure is one of the preconditions for the stability of the financial system. The provision of business continuity is an important element in order to guarantee continuous functioning of financial market infrastructures in emergency situations. The financial market infrastructure comprises the payment and securities settlement systems. The Bank of Latvia is interested in promoting smooth operation of the payment and securities settlement systems important for the stability of financial system in Latvia.
In Latvia, there are three important payment systems whose operation is ensured by the Bank of Latvia: the Interbank Automated Payment System (the SAMS) executing large value interbank settlements in lats in real time, the Electronic Clearing System (the EKS), the only retail payment clearing system in Latvia for settlements in the national currency, processing bulk retail payments, and TARGET2-Latvija that processes real-time gross settlements in euro. Disruptions to the functioning of these systems may have an adverse impact on the entire financial system, suspending a timely sending or receiving of payments.
The securities settlement system DENOS of the Latvian Central Depository (LCD) and the securities settlement system VNS of the Bank of Latvia are also systemically important for the stability of the financial system in Latvia.
The objectives of the Bank of Latvia's business continuity management are to identify potential threats that may affect the attainment of the Bank's objectives and jeopardise the fulfilment of its tasks, and establish and implement a set of measures to ensure protection of the Bank against such threats.
The Bank of Latvia has specified the functions whose forced discontinuity may cause an emergency situation and endanger the execution of the Bank's tasks (critical functions); specified also are the maximum permissible periods of forced discontinuity and the critical resources to be used in the implementation of these functions. On a regular basis, the Bank of Latvia's management reviews and assesses the list of functions and critical resources as well as the adequacy and availability of the resources for ensuring the continuity of the Bank's operations in case of emergency.
In the field of business continuity management, the following documents have been developed at the Bank of Latvia:- regulations governing the organisational procedures for the business continuity management process and the procedures for incident, emergency situation and crises management;
- business continuity action plans that stipulate an ongoing maintenance of critical functions and availability of critical resources and provide for an execution of preventive measures to ensure an uninterrupted maintenance of critical functions;
- a secondary site provision plan that stipulates the location and equipment of the secondary site for the staff involved in the implementation of critical functions, management of incidents, critical incidents and emergency situations, should their primary site be unavailable in case of incidents or critical incidents.
- Business continuity for market infrastructures
- "Business continuity
oversight expectations for systemically important payment systems (SIPS)"
(
85 KB)
At the Bank of Latvia, the business continuity action plans are tested and updated on a regular basis and a plan for organising training in the field of business continuity and testing thereof has been devised for the current year.
In addition, the functioning of TARGET2-Latvija is regulated by "System Regulations for Participation in TARGET2-Latvija" where the procedures for business continuity and handling emergency situations are described in Appendix 4.
A business continuity plan is also in place for the LCD securities settlement system DENOS. In 2007 a provision was added to the "Law on the Financial Instruments Market" stipulating that the LCD should have a business continuity plan ensuring the performing of its core functions and the storing of information; also, the Law describes the set of activities to be undertaken in case the LCD fails to perform the functions as per Law. The LCD has made its responses to the ECSDA questionnaire publicly available on its website:
ECSDA Questionnaire_2007
( 245 KB).
Chapter IV of the Questionnaire, among other, deals with business continuity management.
Useful links:
European Central Bank links: